LOSING LISTENERS

New music-streaming service has lost 21% of its trial users, not 48% research firm estimated

A survey found that 48 per cent of Apple Music trial users have quit, but Apple says otherwise,

SAN FRANCISCO— A survey of 5,000 consumers by music industry research company MusicWatch found that 48 per cent of Apple Music trial users have bailed on the service. Apple countered Tuesday that the number of defectors is in fact far lower.

According to Apple spokesman Tom Neumayr, only 21per cent have opted out since Apple Music went live June 30.

MusicWatch managing partner Russ Crupnick wrote in a blog post that with “40 per cent of iOS users buying digital downloads from iTunes, (the) trial of Apple Music could be higher” in terms of adoption rate. “That’s the disadvantage of not being the first mover in a market where very good services currently exist.”

Among those sticking with the service, 64 per cent said they are extremely or very likely to pay to subscribe to the service when the free trial expires in early October, according to MusicWatch. “On the other hand,” the MusicWatch blog post says, “61 per cent reported that they had already turned off the auto-renewal option in their iTunes account settings.”

Last month, Apple announced that four weeks into the new streaming music service, it had signed up 11 million users, which, if all of them became paying members when the service begins charging in October, represents half of Spotify’s pay- ing membership.

The critical question remains just how many listeners Apple can convert into $10 (individual) and $15 (family) monthly memberships.

In 2014, about 100 million people bought music from Apple’s iTunes store, an arguably large audience for its product, although Apple’s late entry into the market — already teeming with services such as Pandora and Rhapsody — puts it more in a come-from-behind position in the space.

The MusicWatch survey also found that 77 per cent of Apple’s iOS users in the U.S. are aware of Apple Music. And a third of Apple Music’s current users say they have been encouraged to buy more digital tracks as a result of listening to the service, while “very few Apple Music users claimed to stop buying downloads altogether.”

Music industry analyst Mark Mulligan blogged a “glass half empty . . . and half full” scenario for Apple Music, noting that, half full, Apple would appear to be converting would-be subscribers at a blistering pace. “Five weeks after launching its premium tier, Spotify had less than 100,000 paying subscribers,” he writes.

On the half-empty side is the fact that awareness of streaming as a popular and growing alternative to music ownership is far higher than when Spotify launched in 2008 and “Apple hasn’t actually got anyone to part with cash yet.”

Nevertheless, Mulligan projects that by leveraging its huge reach, Apple Music will net 8.7 million paying subscribers by the end of 2015.